Al's Bargain Place

FBI now investigating 'spy' arrested at Dunes

Sat, 21 Feb 2009 05:38:11 GMT

February 20, 2009

By Andy Grimm

Post-Tribune staff writer

An alleged con man who reportedly duped high-profile military and political figures claiming to be a counterintelligence expert and Special Forces officer now is being investigated by the FBI, local officials said Thursday.

Joseph Cafasso, 52, has been in the Porter County Jail since Jan. 22, awaiting trial for failing to appear in court on charges of speeding and giving a false name to police investigators after he was pulled over in the Indiana Dunes State Park in October.

Conservation officers declined to comment Thursday on Cafasso, stating his case had been referred to the FBI for further investigation. FBI officials declined to say if they are investigating Cafasso.

According to an April 29, 2002, report in the New York Times, Cafasso claimed to be a well-connected spy who had a high-rank career in the Special Forces. Alleged victims included the Fox News network, Pat Buchanan's presidential campaign and "several representatives, military officials and activists to whom he had sold himself for years," the Times reported.

Cafasso also appeared as a military and counterterrorism expert during Fox's coverage of the invasion of Afghanistan, even though military records show that his total military experience was 44 days of boot camp at Fort Dix, N.J., in 1976.

Cafasso reportedly had been living for several months with a Chesterton woman whom he met on an Internet dating Web site, where he posted his identity as "Robert Stormer." That also was the name Cafasso initially gave to Conservation Officer Robert Kauffmann, as well as a false Social Security number, before admitting his real name.

The woman turned over to Chesterton police a laptop computer that belonged to Cafasso and investigators there said they might seek a warrant to search the computer's memory for evidence in an investigation of Cafasso.

All that stands between Cafasso and freedom, pending trial, is $500 bond, the Porter County Sheriff's department said.

Cafasso's alleged exploits have garnered him a Wikipedia page, and several other Web sites and blogs devoted to tracking his movements and activities.

Contact Andy Grimm at 648-3073 or agrimm@post-trib.com. Comment on this story at www.post-trib.com

UBS Pressed for 52,000 Names in 2nd Inquiry

Fri, 20 Feb 2009 05:59:15 GMT

Published: February 19, 2009

The UBS memo was blunt: the “Swiss solution” could help affluent Americans.

That message, sent to the bank’s executives in July 2004, referred to a UBS plan to help rich customers evade taxes by hiding money in offshore havens like the Bahamas.

The memo, along with dozens of e-mail messages like it, were disclosed on Thursday in a blistering court document filed by the Justice Department, which sought to compel UBS, based in Switzerland, to divulge the identities of 52,000 Americans whom the authorities suspect of using secret offshore accounts at the bank to dodge taxes.

The move opened a new, unexpected front against UBS, which a day earlier had agreed to pay $780 million to settle claims that it defrauded the Internal Revenue Service, and against Switzerland’s long tradition of banking secrecy.

The number of clients the authorities are seeking to identify is far higher than previously believed, raising new questions about the scale of UBS’s activities and the number of Americans who could be snared in the investigation. Federal authorities initially focused on 19,000 accounts, and UBS turned over about 250 names on Wednesday. That figure now seems certain to grow.

The court document alone dealt a stinging blow to UBS, whose corps of private bankers discreetly tend the fortunes of billionaires and multimillionaires. Filed in a Miami court, the papers provide a rare inside look at the secretive ways of Swiss banking.

The 2004 memorandum, for instance, described how UBS created hundreds of “dummy” offshore corporations where its clients could hide money from the I.R.S. An e-mail message sent that year captured some of the coded language used by UBS bankers. In their world, “one nut” meant $250,000, while “one swan” meant $1 million. Colors were used to designate certain currencies. Orange, for example, represented the euro; blue, the British pound. Several messages described UBS actively referring clients to outside lawyers and accountants in Switzerland and elsewhere who set up secret accounts for them.

In a brief interview on Thursday, one UBS client said the bank also provided wealthy clients with electronic devices with coded computer chips that enabled them to gain access to their accounts and transfer money secretly. The passwords changed each time the accounts were accessed.

In the criminal investigation that led to this week’s settlement, the Justice Department had zeroed in on about 19,000 wealthy Americans. Those UBS customers had a combined $20 billion in assets at the bank, and may have evaded $300 million a year in federal taxes through UBS’s undeclared offshore private banking services.

But the I.R.S. has been conducting a parallel investigation, and on Thursday the Justice Department asked a federal judge to require UBS to disclose to the I.R.S. the identities and records of the 52,000 clients. In the past, UBS has suggested that the 19,000 accounts under investigation, which it is now closing, were the extent of its undeclared offshore banking services.

UBS, the world’s largest private bank, said it would vigorously challenge the efforts.

As part of Wednesday’s settlement, the Justice Department received the names and bank records of about 250 wealthy American clients of UBS. According to people briefed on the matter, the department was preparing to indict several on charges of offshore tax evasion. A Florida federal judge is expected to approve the enforcement request in three to six months, which allows UBS time to appeal and ask for extensions.

If UBS does not comply with the approved summons, it could be in default of its deferred prosecution agreement, potentially opening itself and its senior executives to indictment.

Samuel Buell, who helped to prosecute Enron and now teaches criminal and securities law at Washington University in St. Louis, said that UBS’s declaration that it would fight the government’s latest efforts suggested the bank was caught in a bind. Federal prosecutors want it to lift the veil of Swiss banking secrecy, but Swiss financial privacy laws punish the disclosure of client names.

Modifying Mortgages Can Be Tricky

Thu, 19 Feb 2009 07:01:19 GMT

But many more people appear to have the experience of Mr. Mitchell, the other Florida borrower.

Mr. Mitchell bought his Miami home four years ago for $282,000. In 2007, his wife had to work less to care for a sick child, and the family was hit with higher tax bills and insurance premiums, raising monthly payments to $2,700 from $2,200.

When Mr. Mitchell told Wells Fargo he could not keep up, he said, “It fell on deaf ears for a while.”

Wells Fargo ultimately cut Mr. Mitchell’s interest rate to 6.1 percent, from 6.5 percent. But it added fees, back payments and penalties to his principal, raising it above $300,000. His payments were virtually unchanged, and he was asked to make a $5,000 payment to get out of foreclosure. He fell behind again right away. His house, he estimates, is worth only $199,000.

“The arrangements they come up with are not really in your best interest,” he said. “You feel like you’re trapped.”

Wells Fargo declined to comment for this article.

Analysts say it is hard to know exactly why different mortgage companies handle delinquent loans so differently.

Smaller companies like Ocwen that are under more financial pressure and have more experience in dealing with higher-cost loans have been most aggressive in lowering payments, said Mr. Dubitsky, the Credit Suisse analyst. Big banks like Wells Fargo, which would need to be retooled to emphasize modifications over foreclosures, appear to favor modifications that do not lower payments or debts very much.

A spokesman for the comptroller, Bryan Hubbard, said that many banks began focusing on lowering monthly payments last year and that it would be premature to say they had not done enough to help borrowers.

Lowering payments is becoming more important as the economy weakens, Mr. Dubitsky said, because more borrowers are likely to lose jobs or encounter expenses they cannot afford.

“If the borrower is spending every last dollar on their debt,” he said, “that leaves them vulnerable to unexpected expenses.”
Vikas Bajaj reported from Miami Gardens, and John Leland from New York.

A Swiss Bank Is Set to Open Its Secret Files

Thu, 19 Feb 2009 06:51:38 GMT

By LYNNLEY BROWNING

Published: February 18, 2009

In the hush-hush world of Swiss banking, the unthinkable is happening: secrets are spilling into the open.

UBS, the largest bank in Switzerland, agreed on Wednesday to divulge the names of well-heeled Americans whom the authorities suspect of using offshore accounts at the bank to evade taxes. The bank admitted conspiring to defraud the Internal Revenue Service and agreed to pay $780 million to settle a sweeping federal investigation into its activities.

It is unclear how many of its clients’ names UBS will divulge. Federal prosecutors have been examining about 19,000 accounts at the bank, but UBS ultimately may disclose the identities of only a few hundred customers.

But to some, turning over any names at all heralds the end of the secret Swiss bank account, whose traditions date to the Middle Ages.

“The Swiss are saying that this is the end of Swiss banking as they knew it,” said Jack Blum, an offshore tax specialist. “Nobody will trust the security of the Swiss bank account.”

As part of the settlement, UBS agreed to cooperate with a broad summons issued by the Justice Department to turn over the names. Under the terms of a so-called deferred prosecution agreement, the bank and its executives could be indicted if UBS didn’t identify the customers.

UBS has said it is closing the offshore accounts of its American clients. But under the deal with the United States authorities, the bank must provide periodic written evidence of that to prosecutors. UBS earned $200 million annually from the business.

Prosecutors suspect that from late 2002 to 2007, UBS helped American clients illegally hide $20 billion, letting them evade $300 million a year in taxes.

In a striking admission, UBS said that from 2000 through 2007, some of its private bankers and managers had “participated in a scheme to defraud the United States” and the I.R.S. by helping American clients set up and conceal offshore accounts. The scheme involved falsifying or not properly obtaining or filing certain tax forms required of both the bank and its clients.

UBS’s offshore private banking business once employed some 60 private bankers in Lugano, Zurich and Geneva. Prosecutors claimed UBS referred clients to lawyers and accountants who set up secret offshore entities to conceal assets from the I.R.S.

UBS urged some American clients to destroy records and to stash watches, jewelry and artwork that they had bought with money hidden offshore in safe deposit boxes in Switzerland. The bank also encouraged them to use Swiss credit cards so the I.R.S. could not track purchases. In a statement on Wednesday, Peter Kurer, the chairman of UBS, said that “UBS sincerely regrets the compliance failures in its U.S. cross-border business that have been identified by the various government investigations in Switzerland and the U.S., as well as our own internal review. We accept full responsibility for these improper activities.”

Marcel Rohner, the group chief executive of UBS, said in a statement that “it is apparent that as an organization we made mistakes and that our control systems were inadequate.”

In January a senior UBS executive, Raoul Weil, was declared a fugitive, two months after being indicted by a federal judge in connection with the investigation of the bank. Mr. Weil, a Swiss citizen, oversaw the cross-border private banking operations from 2002 to 2007.

UBS had fiercely resisted turning over the names, even after some executives were indicted and implicated in the offshore private banking business. Swiss law distinguishes broadly between tax avoidance, tax evasion and tax fraud. Unlike in the United States, tax evasion is not a criminal offense under Swiss law.

The move by UBS to settle the case, on the eve of a Senate subcommittee hearing next Tuesday on the matter, signals how close the bank came to being indicted for not cooperating with prosecutors. Indictment is a near-certain death knell for corporations.

Of the $780 million that UBS will pay, $380 million represents disgorgement of profits from its cross-border business. The remainder represents United States taxes that UBS failed to withhold on the accounts. The figures include interest, penalties and restitution for unpaid taxes

As part of the deal, UBS also entered into a consent order with the Securities and Exchange Commission in which it agreed to charges of having acted as an unregistered broker-dealer and investment adviser for Americans.

The settlement caps a painful run for UBS, which suffered more than $50 billion in losses in the collapse of the American mortgage market and received a $60 billion bailout from the Swiss government last October.

The bank will not have to pay additional fines and penalties, which could have brought the deal to more than $1 billion. People briefed on the issue said the banking crisis and the recession were factors in this decision by prosecutors.In the hush-hush world of Swiss banking, the unthinkable is happening: secrets are spilling into the open.

But to some, turning over any names at all heralds the end of the secret Swiss bank account, whose traditions date to the Middle Ages.

“The Swiss are saying that this is the end of Swiss banking as they knew it,” said Jack Blum, an offshore tax specialist. “Nobody will trust the security of the Swiss bank account.”

Prosecutors suspect that from late 2002 to 2007, UBS helped American clients illegally hide $20 billion, letting them evade $300 million a year in taxes.

Marcel Rohner, the group chief executive of UBS, said in a statement that “it is apparent that as an organization we made mistakes and that our control systems were inadequate.”

STOP ALL THE BULL

Wed, 18 Feb 2009 19:53:49 GMT

We have got to stop all the cretizem and all racism and work together and that means republicans. We have a nation at stake and millions depending on stimulus working. The next job lost could be YOURS.Weather you like who is running this country if we do not stand behind them, were divided and nothing is going to work. Now is the time to get rid of as much corruption as we can, the corruption alone would put us ahead in this economy. The $50,000,000,000 dollars madoff took us for was caught 20 years ago and nothing done! All the other corruptions that have happened in the near past. the new 8,000,000,000 in texas.Billions unaccounted for in Iraq! unjust war has cost hundreds of billions.20,000,000 illigal immigrants in this country taking citizens jobs and health care away from citizens! Is this what republicans are crying about i think not.The republicans are the problem!

RECOVERY.GOV

Tue, 17 Feb 2009 14:42:10 GMT

The American Recovery and Reinvestment Act will be carried out with full transparency and accountability -- and Recovery.gov is the centerpiece of that effort. In a short video, President Obama describes the site and talks about how you'll be able to track the Recovery Act's progress every step of the way.

Accountability and Transparency

This is your money. You have a right to know where it's going and how it's being spent. Learn what steps we're taking to ensure you can track our progress every step of the way.

Learn More

Share your Recovery Story

Tell us how the Recovery Act is affecting you. What's working? What isn't? We want to hear from you.

Share your Story

Where is Your Money Going?

* Learn More

Welcome to Recovery.gov

Recovery.gov is a website that lets you, the taxpayer, figure out where the money from the American Recovery and Reinvestment Act is going. There are going to be a few different ways to search for information. The money is being distributed by Federal agencies, and soon you'll be able to see where it's going -- to which states, to which congressional districts, even to which Federal contractors. As soon as we are able to, we'll display that information visually in maps, charts, and graphics.

On Our Way: Read the Bill

The President recently signed the American Recovery and Reinvestment Act into law. Read the full bill here.

Timeline - Milestones at a Glance

Drag the timeline to scroll through the milestones.

Fraud

Tue, 17 Feb 2009 11:24:34 GMT

How can anyone get economy under control when there is so much FRAUD in this country and not much punishment for the FRAUD ?

U.S. Accuses Texas Financial Firm of ‘Massive’ Fraud

Tue, 17 Feb 2009 11:13:44 GMT

Published: February 17, 2009

Stopping what it called a “massive ongoing fraud,” the Securities and Exchange Commission on Tuesday accused Robert Allen Stanford, the chief of the Stanford Financial Group, of fraud in the sale of about $8 billion of high-yielding certificates of deposit held in the firm’s bank in Antigua. Also named in the suit were two other executives and some affiliates of the financial group.

In the complaint, filed in Federal District Court in Dallas, the S.E.C. accused Mr. Stanford and two associates — James M. Davis, a director and chief financial officer of Stanford Group and the Antigua-based bank affiliate, and Laura Pendergest-Holt, the chief investment officer of both organizations — with misrepresenting the safety and liquidity of the uninsured CDs.

The CDs were sold by Stanford International Bank through the firm’s registered broker-dealer and investment adviser, which are in Houston. Both the bank, which claims $8.5 billion in assets and 30,000 clients in 131 countries, and the brokerage unit, which operates about 30 offices in the United States, were named in the S.E.C. suit. Stanford Financial asserts that it advises about $50 billion in assets.

In its complaint, the S.E.C. said it could not account for the $8 billion in assets that were housed in the Antigua bank after issuing subpoenas for bank records and to various witnesses. Most witnesses, including Mr. Stanford, Mr. Davis, and the Antigua-based bank’s president, failed to appear to testify nor did they produce documents shedding light on the assets.

Ms. Pendergest-Holt said in testimony to the S.E.C. that she could not account for the assets, asserting that Mr. Stanford and Mr. Davis were the only ones with access to the bank’s assets.

In the complaint, the S.E.C. called “improbable, if not impossible” claims by the offshore bank that it paid “significantly” higher returns on its CDs because of the high quality of its investments.

The S.E.C. accused the bank and its affiliates of falsely stating in marketing materials that client funds were placed in liquid financial instruments, when in fact they were invested in private equity funds and real estate. On Nov. 28, Stanford International Bank quoted a rate of 5.375 percent on a $100,000 three-year CD, compared with rates of less than 3.2 percent at American banks. The bank recently has offered rates of more than 10 percent on five-year CDs, the filing stated.

In the complaint, the S.E.C. requested that the defendants’ assets be frozen and that a receiver be appointed to take control of business operations. It also requested that the assets of the bank and other offshore units be repatriated. And the agency asked that Mr. Stanford and the other named executives be required to surrender their passports.

The S.E.C. has come under fire in Congress and the media for ignoring repeated warnings over a period of years about the Bernard L. Madoff, who is accused of running a $50 billion Ponzi scheme. While investigators have been looking at Mr. Stanford and his financial empire’s activities for many months, the scrutiny into the too-good-to-be-true returns on the CDs increased substantially after the Madoff case.

Oddly enough, even the Stanford operation was touched by Mr. Madoff. Despite the fact the Antigua-bank assured investors in a report in December 2008 that it had no “direct or indirect” exposure Mr. Madoff’s funds, the bank suffered an estimated $400,000 in losses, apparently through investments in so-called “feeder funds.”

Additionally, the S.E.C. accused Stanford Capital Management, another Houston-based investment advisory unit, of inflating the performance of its $1.2 billion-asset Stanford Allocation Strategy mutual fund in promoting it to prospective investors.

The complaint also accused the offshore banking unit and the Houston-based broker dealer of violating provisions of the Investment Company Act of 1940 in failing to register as an investment company.

E-mail: creswell@nytimes.com

With no budget, California to cut 20,000 state jobs

Tue, 17 Feb 2009 11:08:29 GMT

Tue Feb 17, 2009 3:14am EST

LOS ANGELES (Reuters) - California, which is on the brink of running out of cash, will notify 20,000 state workers on Tuesday their jobs may be eliminated, a spokesman for Governor Arnold Schwarzenegger said on Monday.

The announcement came a day after California lawmakers narrowly failed to pass a $40 billion budget that would have plugged the state's deficit with a mix of tax hikes and spending cuts.

"In the absence of a budget, the governor has a responsibility to realize state savings any way he can," said Aaron McLear, a spokesman for the Republican governor. "This is unfortunately a necessary decision."

The layoff notices will affect about 20 percent of state workers, McLear said, adding the cuts would extend to every part of state government.

The positions would be eliminated in June in preparation for California's next fiscal year, which starts in July.

California, America's most populous state and the world's eighth biggest economy, has experienced a dramatic fall in revenues because of the housing downturn, rising unemployment and a sharp pullback in consumer spending.

To conserve cash, the state has stopped public works projects, furloughed state employees for two days a month and postponed sending out tax refunds.

(Reporting by Nichola Groom; Editing by Peter Cooney)

U.S. agents seen entering Stanford office in Houston

Tue, 17 Feb 2009 11:06:04 GMT

Tue Feb 17, 2009 11:31am EST

HOUSTON (Reuters) - Federal agents with the U.S. Marshals Service entered the Houston office of Stanford Financial Group on Tuesday, according to a Reuters eyewitness on the scene.

(Reporting by Anna Driver)

Caliifornia State

Mon, 16 Feb 2009 18:09:54 GMT

Just One State
This is only one State...............If this doesn't open your eyes nothing will !

From the L. A. Times

1.40% of all workers in L. A. County ( L. A. County has 10.2 million people )are working for cash and not paying taxes. This is because they are predominantly illegal immigrants working without a green card.

2.95% of warrants for murder in Los Angeles are for illegal aliens.

3.75% of people on the most wanted list in Los Angeles are illegal aliens.

4.Over 2/3 of all births in Los Angeles County are to illegal alien Mexicans on Medi-Cal , whose births were paid for by taxpayers.

5.Nearly 35% of all inmates in California detention centers are Mexican nationals here illegally

6.Over 300,000 illegal aliens in Los Angeles County are living in garages.

7. The FBI reports half of all gang members in Los Angeles are most likely illegal aliens from south of the border.

8.Nearly 60% of all occupants of HUD properties are illegal.

9. 21 radio stations in L. A. are Spanish speaking.

10. In L. A. County 5.1 million people speak English, 3.9 million speak Spanish.
(There are 10.2 million people in L. A. County )

(All 10 of the above are from the Los Angeles Times)

Less than 2% of illegal aliens are picking our crops, but 29% are on welfare Over 70% of the United States ' annual population growth (and over 90% of California , Florida , and New York ) results from immigration. 29% of inmates in federal prisons are illegal aliens.

We are a bunch of fools for letting this continue

HOW CAN YOU HELP ?

Send copies of this letter to at least two other people. 100 would be even better.

This is only one State................

If this doesn't open your eyes nothing will !

Domain for sale

Sun, 15 Feb 2009 09:14:51 GMT

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News Stations

Sat, 14 Feb 2009 22:16:44 GMT

News stations how will people that got reverse mortgages will fare out?

U.S. Military Will Offer Path to Citizenship

Sat, 14 Feb 2009 21:32:53 GMT

Published: February 14, 2009

Stretched thin in Afghanistan and Iraq, the American military will begin recruiting skilled immigrants who are living in this country with temporary visas, offering them the chance to become United States citizens in as little as six months.

Immigrants who are permanent residents, with documents commonly known as green cards, have long been eligible to enlist. But the new effort, for the first time since the Vietnam War, will open the armed forces to temporary immigrants if they have lived in the United States for a minimum of two years, according to military officials familiar with the plan.

Recruiters expect that the temporary immigrants will have more education, foreign language skills and professional expertise than many Americans who enlist, helping the military to fill shortages in medical care, language interpretation and field intelligence analysis.

“The American Army finds itself in a lot of different countries where cultural awareness is critical,” said Lt. Gen. Benjamin C. Freakley, the top recruitment officer for the Army, which is leading the pilot program. “There will be some very talented folks in this group.”

The program will begin small — limited to 1,000 enlistees nationwide in its first year, most for the Army and some for other branches. If the pilot program succeeds as Pentagon officials anticipate, it will expand for all branches of the military. For the Army, it could eventually provide as many as 14,000 volunteers a year, or about one in six recruits.

About 8,000 permanent immigrants with green cards join the armed forces annually, the Pentagon reports, and about 29,000 foreign-born people currently serving are not American citizens.

Although the Pentagon has had wartime authority to recruit immigrants since shortly after the Sept. 11 attacks, military officials have moved cautiously to lay the legal groundwork for the temporary immigrant program to avoid controversy within the ranks and among veterans over the prospect of large numbers of immigrants in the armed forces.

A preliminary Pentagon announcement of the program last year drew a stream of angry comments from officers and veterans on Military.com, a Web site they frequent.

Marty Justis, executive director of the national headquarters of the American Legion, the veterans’ organization, said that while the group opposes “any great influx of immigrants” to the United States, it would not object to recruiting temporary immigrants as long as they passed tough background checks. But he said the immigrants’ allegiance to the United States “must take precedence over and above any ties they may have with their native country.”

The military does not allow illegal immigrants to enlist, and that policy would not change, officers said. Recruiting officials pointed out that volunteers with temporary visas would have already passed a security screening and would have shown that they had no criminal record.

“The Army will gain in its strength in human capital,” General Freakley said, “and the immigrants will gain their citizenship and get on a ramp to the American dream.”

In recent years, as American forces faced combat in two wars and recruiters struggled to meet their goals for the all-volunteer military, thousands of legal immigrants with temporary visas who tried to enlist were turned away because they lacked permanent green cards, recruiting officers said.

Recruiters’ work became easier in the last few months as unemployment soared and more Americans sought to join the military. But the Pentagon, facing a new deployment of 30,000 troops to Afghanistan, still has difficulties in attracting doctors, specialized nurses and language experts.

Several types of temporary work visas require college or advanced degrees or professional expertise, and immigrants who are working as doctors and nurses in the United States have already been certified by American medical boards.

Military figures show that only 82 percent of about 80,000 Army recruits last year had high school diplomas. According to new figures, the Army provided waivers to 18 percent of active-duty recruits in the final four months of last year, allowing them to enlist despite medical conditions or criminal records.

Military officials want to attract immigrants who have native knowledge of languages and cultures that the Pentagon considers strategically vital. The program will also be open to students and refugees.

The Army’s one-year pilot program will begin in New York City to recruit about 550 temporary immigrants who speak one or more of 35 languages, including Arabic, Chinese, Hindi, Igbo (a tongue spoken in Nigeria), Kurdish, Nepalese, Pashto, Russian and Tamil. Spanish speakers are not eligible. The Army’s program will also include about 300 medical professionals to be recruited nationwide. Recruiting will start after Department of Homeland Security officials update an immigration rule in coming days.

Pentagon officials expect that the lure of accelerated citizenship will be powerful. Under a statute invoked in 2002 by the Bush administration, immigrants who serve in the military can apply to become citizens on the first day of active service, and they can take the oath in as little as six months.

For foreigners who come to work or study in the United States on temporary visas, the path to citizenship is uncertain and at best agonizingly long, often lasting more than a decade. The military also waives naturalization fees, which are at least $675.

To enlist, temporary immigrants will have to prove that they have lived in the United States for two years and have not been out of the country for longer than 90 days during that time. They will have to pass an English test.

Language experts will have to serve four years of active duty, and health care professionals will serve three years of active duty or six years in the Reserves. If the immigrants do not complete their service honorably, they could lose their citizenship.

Commenters who vented their suspicions of the program on Military.com said it could be used by terrorists to penetrate the armed forces.

At a street corner recruiting station in Bay Ridge in Brooklyn, Staff Sgt. Alejandro Campos of the Army said he had already fielded calls from temporary immigrants who heard rumors about the program.

“We’re going to give people the opportunity to be part of the United States who are dying to be part of this country and they weren’t able to before now,” said Sergeant Campos, who was born in the Dominican Republic and became a United States citizen after he joined the Army.

Sergeant Campos said he saw how useful it was to have soldiers who were native Arabic speakers during two tours in Iraq.

“The first time around we didn’t have soldier translators,” he said. “But now that we have soldiers as translators, we are able to trust more, we are able to accomplish the mission with more accuracy.”

Inquiry on Graft in Iraq Focuses on U.S. Officers

Sat, 14 Feb 2009 21:29:07 GMT

Federal authorities examining the early, chaotic days of the $125 billion American-led effort to rebuild Iraq have significantly broadened their inquiry to include senior American military officers who oversaw the program, according to interviews with senior government officials and court documents.

Court records show that last month investigators subpoenaed the personal bank records of Col. Anthony B. Bell, who is now retired from the Army but who was in charge of reconstruction contracting in Iraq in 2003 and 2004 when the small operation grew into a frenzied attempt to remake the country’s broken infrastructure. In addition, investigators are examining the activities of Lt. Col. Ronald W. Hirtle of the Air Force, who was a senior contracting officer in Baghdad in 2004, according to two federal officials involved in the inquiry.

It is not clear what specific evidence exists against the two men, and both said they had nothing to hide from investigators. Yet officials say that several criminal cases over the past few years point to widespread corruption in the operation the men helped to run. As part of the inquiry, the authorities are taking a fresh look at information given to them by Dale C. Stoffel, an American arms dealer and contractor who was killed in Iraq in late 2004.

Before he was shot on a road north of Baghdad, Mr. Stoffel drew a portrait worthy of a pulp crime novel: tens of thousands of dollars stuffed into pizza boxes and delivered surreptitiously to the American contracting offices in Baghdad, and payoffs made in paper sacks that were scattered in “dead drops” around the Green Zone, the nerve center of the United States government’s presence in Iraq, two senior federal officials said.

Mr. Stoffel, who gave investigators information about the office where Colonel Bell and Colonel Hirtle worked, was deemed credible enough that he was granted limited immunity from prosecution in exchange for his information, according to government documents obtained by The New York Times and interviews with officials and Mr. Stoffel’s lawyer, John H. Quinn Jr. There is no evidence that his death was related to his allegations of corruption.

Prosecutors have won 35 convictions on cases related to reconstruction in Iraq, yet most of them involved private contractors or midlevel officials. The current inquiry is aiming at higher-level officials, according to investigators involved in the case, and is also trying to determine if there are connections between those officials and figures in the other cases. Although Colonel Bell and Colonel Hirtle were military officers, they worked in a civilian contracting office.

“These long-running investigations continue to mature and expand, embracing a wider array of potential suspects,” a federal investigator said.

The reconstruction effort, intended to improve services and convince Iraqis of American good will, largely managed to do neither. The wider investigation raises the question of whether American corruption was a primary factor in damaging an effort whose failures have been ascribed to poor planning and unforeseen violence.

The investigations, which are being conducted by the Special Inspector General for Iraq Reconstruction, the Justice Department, the Army’s Criminal Investigation Command and other federal agencies, cover a period when millions of dollars in cash, often in stacks of shrink-wrapped bricks of $100 bills, were dispensed from a loosely guarded safe in the basement of one of Saddam Hussein’s former palaces.

Former American officials describe payments to local contractors from huge sums of cash dumped onto tables and stuffed into sacks as if it were Halloween candy.

“You had no oversight, chaos and breathtaking sums of money,” said Senator Claire McCaskill, a Missouri Democrat who helped create the Wartime Contracting Commission, an oversight board. “And over all of that was the notion that failure was O.K. It doesn’t get any better for criminals than that set of circumstances.”

In one case of graft from that period, Maj. John L. Cockerham of the Army pleaded guilty to accepting nearly $10 million in bribes as a contracting officer for the Iraq war and other military efforts from 2004 to 2007, when he was arrested. Major Cockerham’s wife has also pleaded guilty, as have several other contracting officers.

In Major Cockerham’s private notebooks, Colonel Bell is identified as a possible recipient of an enormous bribe as recently as 2006, the two senior federal officials said. It is unclear whether the bribe was actually offered or paid.

When asked if Major Cockerham had ever offered him a bribe, Colonel Bell said in a telephone interview, “I think we’ll end the discussion,” but stayed on the line. Colonel Bell’s response was equally terse when asked if he thought that Colonel Hirtle had carried out his duties properly: “No discussion on that at this time.”The current focus on Colonel Bell is revealed in federal court papers filed in Georgia, where he has a residence and is trying to quash a subpoena of his bank records by the Special Inspector General. The papers, dated Jan. 27, indicate that Colonel Bell’s records were sought in connection with an investigation of bribery, kickbacks and fraud.

Colonel Bell said that he sought to quash the subpoena not because he had anything to hide, but because the document contained inaccuracies. “If they clean it up, I won’t have a problem,” he said, suggesting that he would cooperate. He declined to detail the inaccuracies, although his handwritten notations on the court papers indicated that the home address and the bank account number on the subpoena were incorrect.

Asked whether he knew why the records had been subpoenaed, he said, “That is not for me to direct what they’re going to do.”

Another case that has raised investigators’ suspicions about top contracting officials involves a company, variously known as American Logistics Services and Lee Dynamics International, that repeatedly won construction contracts for millions of dollars despite a dismal track record.

One contracting official committed suicide in 2006 a day after admitting to investigators that she had taken $225,000 in bribes to rig bids in favor of the company. At least two other former contracting officials in Iraq have admitted to taking bribes in the case and are cooperating with investigators. It is unknown what information they may have provided on Colonel Hirtle, a high-ranking contracting official in Baghdad. But Colonel Hirtle signed the company’s first major contract in Iraq in May 2004, a roughly $10 million deal to build arms warehouses for the fledgling Iraqi security forces, according to a copy of the contract and federal officials. The warehouses went largely unbuilt. Investigators said the inquiry into the Lee case was continuing.

“I can’t talk to any media right now, because I don’t know anything about this and I’ve got to do some research on it,” Colonel Hirtle said when reached by phone in California, before abruptly hanging up.

The next day, Colonel Hirtle said he had been “taken aback” by questions about an investigation involving himself. “I try to keep things as transparent and aboveboard as I can,” he said, referring questions to an Air Force public affairs office.

The Air Force referred questions to the United States Army Criminal Investigation Command, where a spokesman, Christopher Grey, said the command “does not discuss or confirm the names of persons who may or may not be under investigation.”

An extraordinary element of the current investigation is a voice from beyond the grave: that of Mr. Stoffel, who died with a British associate, Joseph J. Wemple, in a burst of automatic gunfire on a dangerous highway north of Baghdad in December 2004 as he returned from a business meeting at a nearby military base.

A previously unknown Iraqi group claimed responsibility for the killings, which remain unsolved. The men may simply have been unlucky enough to be engulfed in the violence that was then just beginning to grip the country.

On May 20, 2004, a little more than a week after Colonel Hirtle signed the Lee company’s warehouse contract, Mr. Stoffel was granted limited immunity by the Special Inspector General for what amounted to a whistle-blower’s complaint. Copies of the immunity document were obtained from two former business associates of Mr. Stoffel.

The picture of corruption Mr. Stoffel painted, including the clandestine delivery of bribes, was “like a classic New York scenario,” said a former business associate.

“Fifty thousand dollars delivered in pizza boxes to secure contracts,” said the former associate, a consultant in the arms business with whom Mr. Stoffel sometimes worked in the former Eastern bloc. “Of course, it just looked like a pizza delivery.”

It was Mr. Stoffel’s experience with Eastern bloc weaponry that helped him win a contract to refurbish Iraq’s Soviet-era tanks as part of a program to rebuild Iraq’s armed forces. Mr. Stoffel’s company remains locked in a dispute over payments it says are owed by the Iraqi government.

His problems with American officials were what led him to make the accusations of corruption. Mr. Stoffel, the associate said, “was trying to do this as quietly as possible, to blow the whistle.”

“He knew enough about what was going on, and he was getting pretty frustrated.”
Reporting was contributed by Eric Schmitt from Washington, David Beasley from Atlanta, Margot Williams from New York, and Riyadh Mohammed from Baghdad.